George M. Bishop v. Robert G. Pate and Judy L. Pate

CourtCourt of Appeals of Texas
DecidedAugust 13, 2024
Docket01-23-00008-CV
StatusPublished

This text of George M. Bishop v. Robert G. Pate and Judy L. Pate (George M. Bishop v. Robert G. Pate and Judy L. Pate) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
George M. Bishop v. Robert G. Pate and Judy L. Pate, (Tex. Ct. App. 2024).

Opinion

Opinion issued August 13, 2024

In The

Court of Appeals For The

First District of Texas ———————————— NO. 01-23-00008-CV ——————————— GEORGE M. BISHOP, Appellant V. ROBERT G. PATE AND JUDY K. PATE, Appellees

On Appeal from the 434th District Court Fort Bend County, Texas Trial Court Case No. 17-DCV-243655

MEMORANDUM OPINION

In this real property dispute, three parties claimed title to 4.7695 acres of

unimproved land (“Property”). Appellees, Robert G. Pate and Judy K. Pate, bought

the Property from the Internal Revenue Service in 2017. Shortly after, the trustee of

the T. H. Trust sued the Pates, claiming the Trust bought the Property ten years earlier at a foreclosure sale. No evidence reflected the Trust’s alleged purchase until

the Trust’s attorney, appellant George M. Bishop, recorded a back-dated Substitute

Trustee’s Deed four months into litigation. Bishop himself then claimed title to the

Property through a 2021 Deed of Trust and 2022 Trustee’s Deed four years into

litigation.

The trial court ultimately (1) granted summary judgment on the Pates’

counterclaim to remove cloud from title; (2) declared the Substitute Trustee’s Deed,

2021 Deed of Trust, and 2022 Trustee’s Deed void; (3) found the Pates held title to

the Property; and (4) dismissed all claims against the Pates.

In five issues, Bishop argues that the Pates were not entitled to summary

judgment because (1) the Pates needed to bring a trespass to try title claim instead

of their claim to remove cloud from title; (2) the Pates lacked standing to bring their

claim; (3) a genuine issue of material fact existed as to whether the Pates had an

interest in the Property; (4) his objection to an associate judge presiding over the

summary judgment proceedings should have been sustained; and (5) he was entitled

to a de novo hearing of the associate judge’s rulings.

We affirm.

2 Background

We draw these facts from the pleadings and summary judgment evidence.

A. Bishop conveys the Property to JAB.

In October 2007, Bishop was “the legal and equitable owner and holder of [a]

note and debt” secured by the Property. During this time, the debtor defaulted, and

Bishop appointed his son, K. M. Bishop, as substitute trustee to prepare for a

foreclosure sale. K. M. Bishop was instructed to deliver the debtor a notice of sale,

post notice of the sale on the courthouse door, and record a notice of substitute

trustee sale with the county clerk at least 21 days before the sale. No notice of

substitute trustee sale was recorded, and it is unclear whether a foreclosure

sale actually occurred—the sale for which the Trust claimed to be the highest bidder.

Instead, the record reflects that Bishop conveyed the Property to JAB

Development Company, a Texas corporation, via a general warranty deed notarized

in December 2008 and recorded in the real property records in July 2009.

B. The Pates buy the Property from the IRS.

By February 2013, JAB owed $1,967,056.28 in delinquent taxes. The United

States placed a lien on all JAB’s property and eventually seized the Property for

nonpayment of the delinquent taxes. In March 2017, the Pates bought the Property

at a public auction for $176,000. After the 180-day redemption period expired, the

United States conveyed the Property to the Pates via quitclaim deed. The quitclaim

3 deed stated that the property conveyed was “the same property described in

Warranty Deed from George M. Bishop to JAB . . . .”1

C. Litigation begins.

In July 2017, the Trust sued the Pates, claiming that it had owned the Property

since November 2007 when it purchased it at a foreclosure sale. The Trust asserted

claims of trespass to try title and declaratory judgment, alleging that it was the owner

of the Property and that the Pates’ quitclaim deed from the IRS conveyed no interest.

Bishop was the Trust’s attorney of record. The Pates denied the Trust’s allegations

and argued that “no foreclosure deed conveying the property to [the Trust] exists,

nor has it ever been filed in the real property records.”

Four months after the Trust sued, Bishop recorded a back-dated Substitute

Trustee’s Deed supporting the Trust’s claim to title. The Substitute Trustee’s Deed

stated, among other things, that K. M. Bishop properly posted the foreclosure in

October 2007 and the Trust was the highest bidder at the foreclosure sale. The

Substitute Trustee’s Deed was allegedly executed in December 2016 but not

recorded until October 2017—ten years after the alleged foreclosure sale.

1 The IRS also executed a certificate of sale of seized property showing JAB as the taxpayer and describing the property sold as the same property described in the general warranty deed that Bishop conveyed to JAB.

4 After Bishop recorded the Substitute Trustee’s Deed, the Pates

counterclaimed and cross-claimed against Bishop; K. M. Bishop, individually and

as the substitute trustee; and David H. Hamilton, individually and as the Trust’s

trustee. The Pates alleged that the back-dated Substitute Trustee’s Deed created a

cloud on the title of their Property that should be removed. They also asked for

declarations that the Substitute Trustee’s Deed was invalid and they owned the

Property.

Four years into litigation, in June 2021, Bishop recorded a deed of trust (“2021

Deed of Trust”) stating that the Trust owed him $130,000 for his legal services and

expenses in the lawsuit and that such funds were due within the next 90 days. The

2021 Deed of Trust was secured by the Property.

Six months later, in January 2022, Bishop recorded a trustee’s deed (“2022

Trustee’s Deed”) stating the Trust had defaulted on its note, the Property was posted

for foreclosure, and Bishop was the highest bidder at the foreclosure sale. Bishop

then counterclaimed against the Pates for trespass to try title and declaratory

judgment based on his allegations that he owned the Property and that the 2021 Deed

of Trust and 2022 Trustee’s Deed “wiped out” any claim by the Pates. He requested

a “declaratory judgment that the quitclaim deed from the [IRS] to the Pates gave

them no interest in the [P]roperty.”

5 D. Summary judgment proceedings.

The parties’ competing claims to the Property were disposed of in two

summary judgments.

First, the Pates moved for summary judgment on (1) the Trust’s trespass to try

title claim; (2) their affirmative defenses against the Trust’s declaratory judgment

claim; (3) their claim to remove the cloud created by the Substitute Trustee’s Deed

from their title to the Property; and (4) their claims for statutory and common-law

fraud, breach of warranty of title, declaratory judgment, filing of fraudulent liens,

and conspiracy to defraud. The Trust filed a competing summary judgment motion,

arguing that no evidence supported the causes of action on which the Pates had

moved for summary judgment. After a hearing, the trial court denied the Trust’s

motion and partially granted the Pates’ motion. The trial court dismissed the Trust’s

claims against the Pates, granted the Pates’ counterclaim to remove the Substitute

Trustee’s Deed as a cloud from title of the Property, declared the Substitute Trustee’s

Deed void, and found that the Pates owned the Property.2

Second, the Pates moved for summary judgment on Bishop’s trespass to try

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George M. Bishop v. Robert G. Pate and Judy L. Pate, Counsel Stack Legal Research, https://law.counselstack.com/opinion/george-m-bishop-v-robert-g-pate-and-judy-l-pate-texapp-2024.